Bailey Somers of a relatively new publication called Securities Law 360 has this article entitled "SEC Bypasses Fair Fund in Favor of Claims Administrator" about the SEC's proposal to distribute its $250 million Qwest settlement through the claims administration process in a parallel securities class action.  I previously discussed this proposal here.  As stated in the article,

This is not the first time the SEC has looked to a claims administrator to distribute settlement funds.

In February 2005, the agency outsourced the distribution of a $25 million settlement with Lucent Technologies. In 2004, the agency combined a $150 million settlement with Bristol-Myers Squibb with the $300 million settlement reached in the private class action litigation with the company.

The instances in which an outside distribution fund has been used have greatly benefited investors, according to Bruce Carton, Vice President of Securities Class Action Services at Institutional Shareholder Services, Inc.

“I think it’s a great way to go for the SEC,” Carton said. “I certainly hope we continue to see these outside funds used. We file claims for institutions, and it’s difficult and challenging when you have the WorldCom class action settlement on one hand and the WorldCom SEC settlement on the other. To the extent that those can be combined, it makes investors’ lives much, much easier. It also eliminates the need for the SEC to become a claims administrator.”